Green Paper - Partnership for a new organisation of work
Date: 1997-04-16
Institutions: European Commission
Subjects: competitiveness, employment policy, innovation, organisation of work

it 

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels,  16.04.1997 
COM(97) 128  final 

GREEN PAPER 

PARTNERSHIP  FOR A  NEW ORGANISATION  OF WORK 

(presented by the Commission) 

TABLE OF CONTENTS 

EXECUTIVE SUMMARY 

INTRODUCTION 

1  : TOWARDS A  NEW ORGANISATION OF WORK WHY  AND HOW  ? 

Mass production 

Step-by-step  improvements 
The flexible firm 
A new organisation of work, a demanding change 
A great  potential for  Europe 
Flexibility and security 

2 : POLICY CHALLENGES AND  NEW PARTNERSHIPS 

The labour  market context 
Modernising the legal, contractual and policy framework 

Education and training  : lifelong learning 

Labour law and industrial relations 

Wage systems 
Working time : a new approach 
Taxation 
Social security 
Health and safety at work 
Environmental  issues 
Mainstreaming equal opportunities  policies 
Integration of  people with disabilities 
Labour market policies 
Modernisation of public sector 
Telework 

Building a partnership for  a new organisation of work 

The challenge to the social partners 
The challenge to  policy makers 

3  : THE CONSULTATION PROCESS 

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Executive S\ 

Why a Green Paper? 

This Green Paper is about the scope for  improving employment and competitiveness through a bet 
ter organisation of work at the workplace, based on high skJl», high trust and high quality. !t is about 
the will and ability of  management and workers to take initiatives, to  improve the quality of  goods 
and services, to  make innovations  and to  develop the  production process and consumer  relations. 

The purpose of the Green Paper is to stimulate a European debate on new forms of  organisation of 
work  tc  release this potential. The Green Paper is focused on three questions: 

c  why £ new organisation of work  - and how? 
G  what  are the  policy challenges of  new forms of work  organisation? 
c 

is it possible to establish a new partnership for a mere productive, participative and ie&ming or 
ganisation cf  work? 

TcwereSs a new  organisation  of  work  - why  and  how? 

The  traditional  organisation  of  work,  based  on  the  ideas of  industrial  mass production,  has  been 
questioned more and more during the last 20 to 30 years. A number of organisational changes have 
been tried  in order  to  improve  productivity,  quality  and working  conditions  (quality  circles, just-in-
time systems, team work). 

In parallel with these many different trends there  is now a more fundamental  change in the organ 
isation of work,  a shift from fixed systems of production to a flexible, open-ended process of organ 
isational  development. This new concept of  a process of continuous change is sometimes  described 
as "the  flexible firm"  and the  workplaces  as high trust  and high skill workplaces. There  is no  one 
model, but  an infinite  variety  of  models, which are constantly  being adapted to  the  circumstances 
of the individual firm and its workers. 

The transformation can be explained by three factors, representing change: human resources, mar 
kets and technology. 

There are already  a number  of  case studies demonstrating  the potential  for  productivity  and pros 
perity of  a new organisation  of work.  However, the great majority of firms - and public  authorities 
- are stilf  in the  traditional  form  of  work  organisation. The diffusion  of  new  practices seems to  be 
slow. 

The policy challenges 

The policy challenges  could  be summarized  in one question: how to  reconcile security for  workers 
with the flexibility which firms need? This raises a number of issues for the public authorities and the 
social partners across the spectrum of employment, education and social policy areas: 

•  how  to  organise the  necessary training  and retraining, so that  the workforce  can meet the in 

creasing needs for skills and competence 

•  how to  adapt social législation to take account of  new employment trends 
•  how to change wage systems along with the organisational structures on which they are based 
•  how to  adapt working time arrangements  in the light of the new  situation 
•  how to take advantage of the new employment trends with  regard to  equal  opportunities 
•  how to develop  more flexible organisations  in the public services 
•  how to provide adequate support to firms, in particular small firms, who wish to change, but lack 

the resources or expertise to  do so. 

Ah 

Building a partnership for  a new  organisation  of  work 

The Green Paper invites the social partners and public authorities to seek to  build a partnership  for 
the  development  of  a  new  framework  for  the  modernisation  of  work.  Such a  partnership  could 
make a significant  contribution  to  achieving the  objective  of  a productive,  learning  and participa-' 
tive organisation of  work. 

The word framework  should be given a broad interpretation. It could include everything from  the 
creation of a common understanding of the importance of new forms of work organisation, through 
joint declarations, to binding contractual or legal initiatives. The level and content of such a frame 
work  has to  be clarified through discussions in the social dialogue. 

The Commission would  like all  interested to  develop their  views on how these objectives  could be 
reached and how  all policies, whether  they  are public  policies or  policies for  which the  social part 
ners are  responsible, could  be  mobilized  to  create  a new  framework  to  modernise  work  and  the 
economy. 

At 

INTRODUCTION : WHAT ARE THE AIMS OF THE GREEN PAPER ? 

1.  This Green  Paper  is about  the  scope for  im 
proving  employment  and  competitiveness 
through  a  better  organisation  of  work  at  the 
workplace.  This  need  to  improve  the  employ 
ment situation by increasing competitiveness has 
been at the heart of EU policy and was given add 
ed  impetus  with  the  publication  of  the  White 
Paper  on  Growth, Competitiveness  arid  Employ 
ment in  1993. It has been a main theme at all the 
meetings of the European Council since then and 
is a central element  in the  Commission's Pact for 
Confidence  in  Employment.  In the  course of  the 
discussions  on  the  Pact,  the  Commission  sent  a 
questionnaire to the social partners and prepared 
a synthesis of  the  responses received1 . More re 
cently  the  European  Council  in  Dublin  empha 
sised the importance of adequate benchmarking. 

2.  This  Green  Paper  has  also  to  be  situated  in 
the wider  context  of  the  various Community  in 
itiatives related to employment,  competitiveness 
and  new  technologies,  for  example,  the  Monti 
Group on taxation, the social security  initiatives, 
initiatives  in  the  area  of  new  technologies,  and 
the  Davignon group on workers'  involvement  in 
Europe. 

3.  The  European  employment  strategy  calls  for 
an  integrated  approach,  whereby  all  the  rele 
vant  policies,  including  macro-economic  and 
structural  policies,  contribute  and  support  each 
other  in  the  fight  against  unemployment.  Im 
provements  in  flexibility  of  work  have  been 
highlighted as essential elements of this strategy. 
For  example,  the  European  Council  meeting  in 
Essen in  1994 stressed the  need  to  increase  the 
employment intensity of growth, in particular by 
a  "more  flexible  organisation  of  work  in  a way 
which  fulfils  both  the  wishes  of  employees  and 
the  requirements  of  competition".  But  while 
much has been written  about the  need for  flex 
ibility  of  the  labour  market  and  its  regulation, 
much less has been said about the need for flex 
ibility and security in the organisation of work at 
the workplace. 

4.  One of  the  main aims of this document  is to 
redress this balance by concentrating  on this as 
pect  of  the  wider  employment  debate.  An  im 
proved  organisation  of  work  will  not  of  itself 
solve  the  unemployment  problem,  but  it  can 
make a valuable contribution, firstly, to the com 
petitiveness  of  European firms, and secondly, to 
the  improvement  of  the  quality  of  working  life 
and the employability  of the workforce. 

5.  Research has demonstrated that a renewal of 
the  organisation  of  work  is of  fundamental  im 
portance  for  improved  productivity.  The  White 
Paper on Growth, Competitiveness  and  Employ 
ment2  highlighted  organisational  capacity  as 
one of the  key components of  a firm's competi 
tiveness. The  Commission's  First Action  Plan  for 
Innovation  in  Europe3  also stressed the  impor 
tance of organisational innovation for  growth  in 
employment. 

6.  Work  organisation  itself  is  a  broad  subject, 
including,  as  it  does,  most  aspects  of  the  way 
work  is organised  in and between firms, the re 
lation between the social partners, the organisa 
tion  of  the  labeur  market,  the  relationship 
between  work  and the  organisation  of  society. 
There  is an  intensive  debate  about  the  role  of 
work  in the  future  and there  are many  ongoing 
research  projects  that  will  further  improve  our 
understanding of the new working life. 

In  particular,  the  Commission's  Green  Paper 

7. 
on  "Living and Working in the Information Soci 
ety: People First", covered a wide range of issues 
related  to  the  introduction  of  new  technology 
and the organisation of work, some of which are 
developed  further  in  this  Green  Paper.  At  the 
same  time  there  are  issues  dealt  with  in  the 
present  Green  Paper,  which  are  not  related  to 
new  technologies  and  the  Information  Society, 
notably  those  related  to  the  evolution  of  the 
workforce and of consumer requirements. 

8.  The  present  Green  Paper  does  not  seek  to 
cover all aspects of this vast area. Instead it seeks 
to  concentrate on developments  in work  organ 
isation  in firms and  public  bodies in the  context 
of the economic and social environment. Thus in 
this  paper,  work  organisation  is taken  to  mean 
the  way  in  which  the  production  of  goods  and 
services are organised  at the workplace. The fo 
cus  is  on  a  new  organisation  of  work.  While 
there  is no  one  model, this  concept  implies,  in 
particular,  the  replacement  of  hierarchical  and 
rigid  structures  by  more  innovative  and  flexible 
structures  based on high skill, high trust  and in 
creased  involvement  of  employees. The focus  is 
emphatically  not  on  short-term  cost-cutting 
measures. 

9.  It  should  be  emphasised  that  this  Green 
Paper  is  concerned  with  the  organisation  of 
work  in all types of  workplace  and in  all sectors 
of  activity. Though much of the  language, much 

1  This summary was distributed  on the occasion of  the Round Table organised by the Commission  with  the social 

partners on 30 April  1996 on the Pact of  Confidence  for Employment 

2  Growth,  Competitiveness,  Employment: The Challenges & Ways forward  into  the 21st Century (Chapter 2.3 (b)) 

3  The First Action  Plan for  Innovation  in Europe: Innovation  for  Growth and Employment (COM(96) 589 final) 

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of  the experience  and many  of  the  examples re 
late to  large firms in manufacturing  industry, the 
new  innovative  and flexible  structures are  often 
just as appropriate  in small firms as in large, and 
in  services,  including  public  services  such  as 
health,  education  and  environmental  services. 
The  development  of  naw  forms  of  work  organ 
isation  in SMEs, in particular,  is of  central  impor 
tance,  given  that  they  are  the  main  source  of 
new jobs. 

10. The  modernisation  of  the  organisation  of 
work  can  only  be  achieved  by  the  firms  them 
selves, involving  management and workers - and 
their  representatives  -  and  taking  into  account 
the diverse nature of the situation in each sector, 
company  or  organisation  and  the  speed  of 
change. 

11. 3ut the  new organisation  of  work  also poses 
challenges  to  policy  makers  -  whether  they  be 
public  authorities,  social  partners  or  non-
Governmental organisations - and at all levels: lo 

cal, national and European. In particular the chal 
lenge  is how to  develop  or  adapt  policies  which 
support, rather than hinder, fundamental organ 
isational renewal and how to strike a productive 
balance  between  the  interests  of  business  and 
the  interests  of  workers, thereby  facilitating  the 
modernisation  of  working  life. An  essential  ob 
jective is to achieve such a balance between flex 
ibility  and security throughout  Europe. 

12. Ail  Member  States  are  facing  similar  chal 
lenges  both  with  regard  to  labour  productivity, 
competitiveness  and  employment  and  with  re 
gard  to  achieving  the  right  balance  between 
flexibility  and  security  of  employment.  There  is 
much to  learn from progress made in other com 
panies and in other Member States. The Commis 
sion  hopes  that  this  Green  Paper  will  further 
stimulate  the  debate  at  European  and  national 
level on the  organisation  of work  among  all the 
actors involved and that the outcome of this de 
bate will be a new framework for the modernisa 
tion of working  life based on partnership. 

"A  co-operative approach to a different  organisation  of  work  within  the  firm  will  improve indus 
trial  relations,  allow  greater  worker  participation  in  decisions and potentially  lead  to  a  better 
product  quality.  The latter  in  fact represents an essential component  in any strengthening  of  the 
competitiveness of  the European economy. " - Ciampi report. 

1 : TOWARDS A NEW ORGANISATION OF WORK - WHY 

AND HOW? 

13. For  almost  a  century  the  organisation  of 
work  was  usually  founded  on  the  same  basic 
principle:  a  hierarchical  top-down  organisation 
with  a high degree of  specialisation and simple, 
often repetitive, jobs. 

Mass Production 

14. This type of  organisation was developed as a 
tool  for  the  emerging  industrial  society,  the 
transformation  of  the  economy from  handicraft 
via manufacturing to industrial mass production. 
Europe  can  be  described  as  the  cradle  of  the 
manufacturing  society  and the  US as the  cradle 
of  the  mass  production  system. The  ideas  were 
developed  originally  in  the  US  car  industry, 
which  became  the  role  model  for  successful in 
dustries. 

15. During the 20th century, this type of work or 
ganisation  spread  all  over  the 
industrialised 
world. The rebuilding of  European industry  dur 
ing the  post-war  period  was  based on  the  con 
cept of the mass production system. This produ 
ction  system contributed  for  several  decades  to 
an  unprecedented  growth  in  productivity  and 
prosperity. 

Step-by-step improvements 

16. However, during the last 20-30 years, the lim 
itations of this way of  organising work  have be 
come evident. One major problem has been that 
under the traditional  system the work  is split  up 
into narrow functions with short, repetitive work 
cycles. The way work  is done is prescribed in de 
tail. The system does not give sufficient  room for 
a process of  upgrading  and innovation. For con 
tinuous  improvement  to  be possible, it  is impor 
tant to involve the workers themselves and in or 
der to  be involved they must have the  possibility 
of  exercising judgement,  developing  social  con 
tacts  and  learning. These  are  the  points  where 
the traditional  mass production system becomes 
too  much of  a hindrance. The workplace  has to 
be opened up: to  flows of  ideas, to  suggestions, 
to  learning,  to  improvement.  Initially,  this  was 
done through  the  introduction  of  a parallel de 
velopment  organisation,  such  as quality  circles. 
The  idea  was  to  make  step-by-step  improve 
ments,  day  by  day,  to  get  visible  results  over 
time, instead of waiting for  a crisis to  occur. 

17. The  need  for  such  improvements  has  been 
more  apparent  the  more  the  service  sector  has 

grown and the more services are integrated into  -
the traditional  production  of  goods. As a conse 
quence,  both  management  and  workers  have 
been looking for  new ways of  improving produ 
ctivity  and working  conditions. We  have seen a 
number  of  efforts  and experiments  : new  forms 
of  team-work,  just-in-time  production  systems, 
lean production,  "kaizen"  (continuous  improve 
ment), 
total  quality  management,  eco-
management,  benchmarking, etc. 

The flexible firm 

18. Both  the  traditional  form  of  organisation 
and  that  based  on  step-by-step  improvements 
still  exist  and  will  continue  to  do  so  for  many 
years.  But  in  parallel,  a  more  fundamental 
change in the organisation of  work  is emerging, 
a shift from fixed systems of production to a flex 
ible,  open-ended  process  of  organisational  de 
velopment,  a  process that  offers  new  opportu 
nities for learning, innovation, improvement and 
thereby  increased productivity. 

19. This new concept  of  a process of  continuous 
change  is  sometimes  described  as  "the  flexible 
firm"  and the workplaces as high trust  and  high 
skill workplaces. There is no one model, but an in 
finite variety of  models, which are constantly be 
ing adapted to the circumstances of the individu 
al firm and its workers. The transformation can be 
explained  by three  factors, representing  change: 
human resources, markets and technology. 

-  Human  Resources,  in  traditional  economic 
thinking, labour  is a factor  of  production  similar 
to  land  and  capital  - a cost to  be  reduced.  In a 
knowledge  based  economy,  however,  people 
represent  a key  resource. Organisations  are  val 
ued  not  only  on  the  basis  of  their  products  or 
machines  but  primarily  on  the  knowledge-
creating  capacity  of  the  workforce,  the  people 
who work  for them, how they work, what  work 
means  to  them.  The  rate  of  innovation  and 
change  in  products  and technologies  is so rapid 
that  the  competitive  advantages  of  companies 
and  countries  will  be the  capacity  of  the  work 
force to  create knowledge. The European work 
force  of  the  1990s,  especially  the  younger  age 
group, Is much better educated and trained than 
any earlier generation. About  70 per cent of this 
young  European  workforce  have  an  upper  sec 
ondary  level  education  and  about  20  per  cent 
have a university degree. 

-  Markets.  Consumers  are  more  demanding 
than  ever  before  and they  do not  accept simple 
standardised products. They look for  innovation, 
for  variety  and novelty, for  high  quality, both  in 
goods  and  services. Competition  in  the  market 
place forces firms to  organise production  in such 
a way  that  changing  consumer  preferences  can 
be  met.  That  creates  demand  for  close  links 
between  market  and  production,  capacity  for 
continuous  innovation  and  improvement,  and a 
high degree of flexibility  in production. Compet 
itiveness  and  success  will  more  and  more  be 
based on the  innovative capacity  and adaptabil 
ity  of firms, less and  less on the traditional  con 
cept of producing more of the same at low prices. The 
most innovative and flexible firms are more like 
ly to survive and expand. 

- Technology. During the last 20-30 years a new 
technological  revolution  has  begun,  based  on 
the introduction of  information and communica 
tion technologies, (ICTs). One of the main effects 
of the new ICTs has been a dramatic reduction in 
the  cost  and  time  of  storing,  processing  and 
transmitting  information.  Such  changes  have  a 
fundamental  effect  on the way we  organise the 
production  and  distribution  of  goods and servi 
ces, and  thereby,  on  work  itself.  At  the  begin 
ning  of  this  technological  revolution,  the  eco 
nomic result of the introduction of new informa 
tion systems was rather  poor  in terms of  produc 
tivity growth. But, more recently there is a grow 
ing number  of  examples where the  introduction 
of  ICTs  has  met  the  highest  expectations.  The 
main  message from  these  examples  is the  need 
for an integrated approach, linking the introduc 
tion  of  ICTs with  the  education  and  training  of 
the workforce  and with  organisational  renewal. 

A new organisation of work, 
a demanding change 

20. These three  factors  - human  resources, mar 
kets  and  technology  -  can  have  a  fundamental 
impact on the way workplaces are organised. 

21. The new flexible firm is a demanding form of 
organisation of work. That goes for the introdu 
ction of a new organisation, as well as for the re 
quirements of skills and competence and the de 
velopment of  industrial relations. In the new de 
centralised  and  network-oriented  organisations, 
workers  perform  a  range  of  tasks,  rather  than 
pass the  job  on  from  one  to  another.  The  skill 
structure  is  changing.  Good  skills  in  numeracy 
and  literacy  as well as with  computers, the  abil 
ity to  interact with new technology and with en 
vironmental  requirements,  are  becoming  more 
and more important. There is a need not only for 

higher  skills  but  also  for  broader  skills. That  is 
why  continuous  learning, the  updating  and up 
grading of skills and competencies, as well as in 
vestment  in human capital, are of  crucial  impor 
tance  for  the  improvement  of  the  competitive- -
ness and productivity  of the  European economy. 

22. Furthermore  as  workers  develop  a  wider 
range  of  skills and become more adaptable, the 
new  organisation  of  work  will  further  facilitate 
geographical  mobility.  This  in  turn  will  enable 
workers to exploit their  potential more fully  and 
exercise their  rights in this respect. 

23. The new organisation of work will  challenge 
industrial  relations. The old organisation  is char 
acterised by specialisation of tasks and skills and 
the  separation  of  design  from  the  production 
phase. Industrial  relations will  require, in  a new 
organisation of work, to be built on a basis of co 
operation  and common interest. Therefore, new 
forms  of  industrial  relations  have  to  be  devel 
oped,  including, for  example, greater  participa 
tion  by employees, since efficient  production re 
quires enhanced levels of both trust and commit 
ment  in firms. 

A great potential for Europe 

24. European  industry,  manufacturing  as well as 
services,  has  many  underlying  strengths.  One 
such  strength  is the  Single  Market,  the  biggest 
economic  entity  in  the  world.  Sixteen  million 
firms established in this market  have a great ad 
vantage in being close to  370 million consumers. 
The  new  way  of  organising  work  that  is slowly 
emerging  in  Europe could  be another  strength, 
by improving the  ability to  adjust  production  to 
the new market conditions of ever changing con 
sumer  preference.  In  this  way  the  flexible  firm 
could offer a sound basis for fundamental organ 
isational renewal built on high skill, high produc 
tivity, high quality, good environmental manage 
ment - and good wages. 

25. It  is  important  to  recognise  that  European 
companies  and  public  services  have  already  in 
troduced a great number of organisational inno 
vations, which are in tune with  European condi 
tions. There are a number  of  case studies - some 
examples  are  presented  in the  Report  from  the 
Commission's  Competitiveness  Group  -  demon 
strating  the  potential  for  productivity  and pros 
perity  of  a new work  organisation. The findings 
confirm  that  these  innovations  in  the  organisa 
tion  of  firms  lead  to  improved  business  perfor 
mance,  better  job  protection  and  job  enrich 
ment. The same message comes from the German 
programme  on  Work  and  Technology  and  the 

O 

Scandinavian programmes, showing that the firms 
that  have  restructured  their  work  organisation 
and  industrial  relations  have  been far  more suc 
cessful than  those  that  have  attempted  to  meet 
the challenges solely through the  introduction  of 
advanced  manufacturing  technology.  These  pro 
grammes  also  show  that  trust  and  commitment 
cen  be  effectively  combined  with  sound  forma! 
and contractual agreements. However, many firms 
-  znd  public  authorities  -  are  still  in the  age-old 
work  organisation:  hierarchical,  with  a  high  de 
gree of  specialisation and low  degree of  integra 
tion  and  product  innovation,  defensive  methods 
of restructuring and political demands for reduced 
responsibility in relation to the workforce. The dif 
fusion of new practice seems to be slow. 

traditionally 

26. Their 
informal  structures, 
coupled  with  the  smaller  scale  of  operations, 
have  enabled  SMEs to  avoid  the  organisational 
sclerosis  which  has  hindered  the  adaptation  of 
many  large firms. However, the  informal  nature 
of  relationships  in  SMEs gives  rise to  a  different 
set of problems in relation to work organisation: 
in  particular  the  lack  of  resources  necessary  for 
systematic  organisational  planning  tends  to 
hinder  long-term  personnel  development.  As a 
result, although SME's are potentially better able 
to  adopt  flexible  forms  of  work  organisation, 
further  efforts  need  to  be  made  if  they  are  to 
exploit fully the  opportunities presented. 

27. It  has  to  be  acknowledged  that 
impr 
in  a 
in  productivity  can  result 
ovements 
reduction  in  employment  in  one  part  of  the 
production  chain.  But  improved  productivity  is 
necessary  if  real  wages  and  profits  are  to  be 
increased. Higher wages and profits  lead in turn 
to  the  craation  of  employment  in  a  number  of 
ways:  in  the  firm  itself,  in  its  suppliers,  by 
increasing demand and by creating the wealth to 
pay for the employment intensive services, which 
are  needed  in  fne  future:  in  health,  education, 
leisure and care for  the sick and elderly to  name 
but a few*. 

28. The  choice  is  not,  in  fact,  between  be:ng 
more  productive  or  staying  as  we  are.  It  is 
between remaining competitive or reiegation to 
the  second  division. This  is not  an  easy  option. 
There  ara  a  number  of  obstacles  to 
the 
modernisation  of  firms  and one such obstacle is 
the  lack  of  awareness of  the  possibilities  and of 
the  potential*  of  a new way  of  organising  work. 
There  is a need for  information  and debate  and 
for  initiatives  that  can  stimulate  the  deve 
lopment  of new forms of work organisation, not 
least among the  many SMEs. 
29. Furthermore,  alt  change  creates  turbulence 

and uncertainty. There  are balances which  have 
to  be struck: 

•  between young workers and older  workers 
•  between the well-educated and the less well-

educated 

»  between the need for  high production levels 

and the health of workers  and 

•  above aiJ, between flexibility  and security. 

IFbxfbiGHy and Security 

30. The  potential  economic  benefits  of  a  new-
form  of  work  organisation  based  on 
participation  and  trust  are  substantial,  with 
potential gains for everyone. Public policies need 
to  be  built  on  this  understanding.  However,  it 
has to  be  recognised that  certain  categories  of 
workers in some areas at different periods in the 
in 
economic  cycle  wHI  have  more  difficulty 
adjusting to the new situation than others: these 
include,  in  particular,  older  workers,  younger 
workers  with  low  levels  of  qualification  and 
workers who live in areas of high unemployment 
and  are  not  mobile.  Similarly  while  there  are 
considerable  benefits  for  firms  and  workers 
engaged  in  core  activities,  care  is  needed  to 
ensure  that  a!2  workers.  Irrespective  of  their 
contractual status, share in the 'potential benefits 
of the new work  organisation. 

31. The key issue for  workers, management,  the 
social partners and policy makers alike is to strike 
the  right  balance  between 
flexibility  and 
security.  This  balance  has  many  aspects.  The 
reorganisation of work  often causes uncertainty. 
Workers  need  above  all  to  be  reassured  that 
after  the changes are made they will  still have a 
job  and  thai  this  job  wil!  last  for  a  reasonable 
time.  At  the  same  time,  once  the  changes  are 
made, the  new  organisation  of  work  can  offer 
workers  increased  security  through  greater 
involvement in their  work,  more job satisfaction 
and the possibility of  developing skills and long-
term employability. This security for workers can 
a!so provide emp'evsrs with increased security  in 
form  of  a  more  stable,  versatile  and 
the 
contented  labour force. Employers  need  greater 
flexibility  in  order,  in  particular,  to  cope  with 
fluctuations  in  demands  for  their  goods  and 
services. In particular,  they  are often  looking  for 
interchangeable  fxiifs  and  adaptable  working 
patterns,  including  working  time  arrangements. 
Such  flexible  arrangements  can  also  have 
advantages  for  employees,  provided  thst  they 
are  negotiated  :  vor  example  working  time 
arrangements  which  si:st  their  private  or  family 
commitments. 

4  The employment  potential  in this area is set out  in the  Commission's report  on  "Local development  and  employment 

initiatives:  an investigation  in  the European Union" (SEC/S64/9S) 

32. It is the achievement of this balance between 
flexibility  and  security  which  is  at  the  heart  of 
the  partnership for-a new organisation  of  work, 
which  is the  subject  of  this  Green  Paper. So far 
we have discussed the implications for employers 

and workers. But if this balance is to be achieved, 
there  is a need to  adapt  a wide  range  of  public 
policies  accordingly. These policy  challenges  will 
be discussed in the next chapter. 

Questions 

Do you  share the  views  expressed above on the  evolution  of  the  organisation  of  work  and  the 
main driving forces behind the new developments? Are there other factors that should be includ 
ed? 

What  is your  experience of firms that have introduced new forms of organisation of work? 
Are there particular experiences in respect of small firms, which you would like to  mention? 

Are there examples of new business strategies, which appear more successful in dealing with such 
changes? 

2  : POLICY  CHALLENGES AND  NEW  PARTNERSHIPS 

The labour  market  context 

ficulties  in  returning  to  a working  life  with  new 
and  higher  skill  requirements. 

33. There  is a broad  public  debate  about  the de 
velopment  of  labour  markets  and working  life. 
This  debate  is  linked  to  new  technologies,  the 
globalisation of our economies and to new forms 
of  work  organisation. 

34. The new forms  of  work  organisation  are as 
sociated  w i th  greater  specialisation  by  firms, 
which  leads to new employment-creating  oppor 
tunities  for  sub-contractors.  However,  some  of 
the  changes  that  we  are  witnessing  today  are 
caused  not  by  a  new  organisation  of  work  and 
new technology,  but by a lack of  adaptation and 
modernisation.  The downsizing  of  many  firms is 
often 
the  consequence  of  adverse  macro-
economic  conditions  and bad  management. 

35. Some of the problems  are caused by a failure 
to  integrate  new  technologies  w i th  changes  in 
the  organisation  of  work  and the  upgrading  of 
skills and competence. 

36. It  is difficult  to  isolate  these  factors  in statis 
tics  on  the  development  of  the  labour  market. 
Therefore  caution  is needed when  studying  such 
statistics  in  order  to  avoid  blaming  the  new or 
ganisation  of  work  for the  problems  created  by 
quite  different  factors. 

37. A few facts can serve  as a background  to the 
further  discussion  of  the  challenges  to  existing 
policies  and the need to  modernise  our  policies: 

has  increased 

in the  Mem 
-  employment 
ber  States  of  the  EU in  15 of  the  23 years  since 
1973. The total  increase in these years of  employ 
ment  growth  reached  16 million jobs. However, 8 
million  of  these jobs  were  lost  during  periods  of 
economic  downturn,  giving  a  net  employment 
growth  of  8  million.  This  contrasts  w i th  the 
growth  of the working  age population  by nearly 
28  million  people  over  the  same  period.  Thus, 
the  main  problem  is  that  job  growth  has  not 
been  strong  enough  to  absorb  the  growing 
working  age population. 

-  there  are  many  more  jobs  requiring 
higher  and broader  skills;  there has been a 
marked  shift  in the structure  of  employment  to 
wards  higher-skillecf jobs  that  are,  in  general, 
more stable. Professional, technical and manage 
ment  personnel  grew  by 25 per  cent,  while  the 
number  of  production  workers  decreased. Those 
who  have  lost  their  old jobs  have  had great  dif 

-  the  level  of  permanent  employment 
remains 
temporary  jobs  account  for  a  relatively 
high; 
small  proportion,  around  12 per cent  of  employ 
ees. Such jobs  are often  important  as entry  jobs; 
for  example,  in  1995 50  per  cent  of  the  unem 
ployed  who  found  a  job  took  temporary  posi 
tions.  A  recent  study,  undertaken  by  the  ILO, 
shows  that  job  tenure  has not  been  reduced  in 
recent  years. 

-  working 
time  has become  more  flexible;  about 
16  per  cent  of  employees  work  part-time  and 
such  work  has  become  more  common.  Only  5 
per  cent  of  men  work  part-time  while  30  per 
cent  of  women  work  part-time,  mainly  in  the 
service  sector. 

-  self-employment  has been  stable  over  the  last 
20  years;  self-employed  counted  for  about  15 
per  cent  of the total  workforce  in  1975 and that 
figure  has not  increased  at all. However,  if  agri 
culture  is  excluded,  there  is  evidence  of  some 
growth. 

38. These patterns  are important  to  recognise as 
a  basis for the discussions  on policies  supporting 
flexibility  and  security  in  working  life.  A  more 
detailed  description  of  the  trends  in the  labour 
market  in the  Member  States  is available  in the 
Commission's  publication  "Employment  in  Eu 
rope  1996". 

Modernising the legal, contractual 
and policy  framework 

Education and training: 
lifelong  learning 

39. The new forms  of  work  organisation  require 
a  much  better  educated  and trained  workforce, 
including  in particular  management. The flexibil 
ity  and adaptability  of  skills  are key. Continuous 
training  and retraining  are essential: in  10 years' 
time  80% of  the  technology  we  operate  today 
will  be obsolete,  and replaced  by new, more ad 
vanced  technologies.  By that  time,  80% of  the 
workforce  will  be working  on the basis of  formal 
education  and training  more  than  10 years' old. 

40.  Europe  needs to  develop  a new  architecture 
of  lifelong education and training which  involves 
not  only  all  parts  of  education  and  training 
systems  but  also  firms  and  individuals  them-

It 

selves.  In  addition,  a  culture  of  learning  and 
training  throughout  working  life  needs to  be  ful 
ly  embedded. 
is  hardly  possible  to  over 
estimate  the  importance  of  action  in  this  area, 
which  has been  the  subject  of  a number  of  Com 
mission 
the  Com 
initiatives.  For  example, 
mission's  Green  Paper  "Living  and  Working  in 
the  Information  Society:  People  First"  identified 
four  crucial  areas: 

• 
Laying the  best foundations: the  foundations 
cf  our  knowiedge  and  skills  are  laid  during  the 
first  years  of  education,  and  the  education  pro 
cesses involved  need to  evolve  w i th  the  develop 
ment  of  new  technology  and  w i th  the  new  re 
quirements  for  sustainable  development.  Teach 
ers  and  trainers  in  particular  must  be  targeted 
and  the  quality  of  their  initial  training  and  con 
tinuing  professional  development  secured. 

From  teaching  to  learning:  education  and 
• 
training  institutions  must  be  swiftly  reoriented 
so  that  learning  institutions  are  much  more  re 
sponsive to  changes  in the  skili  needs  of  business 
and industry. One of the  key objectives  identified 
in  the  Commission's  White  Paper  "Teaching  and 
Learning:  towards  the  Learning  Society5"  was 
the  need to  bring schools and the  business sector 
closer  together  to  better  complement  each  oth 
er  as places  of  learning. 

•  The 
learning  company  requires  that  new 
forms  of  partnership  between  business, other  or 
ganisations  and  educators  are  needed  to  ensure 
that  the  new  and  changing  skills  required  are 
made  available. The crux  of  this  approach  is con 
tinually  to  reinforce  the  employabiiity  of  the 
workforce,  as well  as to  increase the  competence 
of  managers  and  decision-takers  through  train 
ing. 

• 
Lifelong  learning  for  all:  there  is  a  strong 
need to  transform  passive  labour  market  policies 
into  active  policies  for  human  resource  invest 
ment,  in  line w i th  the  agreement  at the  Florence 
Summit,  whereas  at  present  not  more than  7 per 
cent  of  the  unemployed  are  offered 
training 
which  would  help  to  equip  them  to  re-enter  the 
labour  market. 

Questions 

How  can  firms  which  seek  to  introduce  new 
forms  of  work  organisation  optimise  their  in 
vestments  in  human  resources? 

What  are  the  obstacles,  including  accounting 
and  tax  constraints,  to  the  promotion  of  in 
vestment  in  human  resources ? 

Labour law  and industrial 
relations 

41.  The new organisation  of work  calls  into  ques 
tion  the  basic  foundations  upon  which  labour 
law  and  industrial  relations  are  built. 

factory 
42. The  concepts  of  work-place,  firm, 
and,  in  particular,  the  notion  of  employer  are 
undergoing  a  process  of  diversification,  leading 
to  an  erosion  of  traditional  employment  rela 
tionships.  Downsizing,  outsourcing,  subcontract 
ing, teleworking, net-working  and joint  ventures 
bring  new  dimensions  to  the  world  of  work  for 
which  traditional  labour  law  provisions  do  not 
appear  to  have  adequate  answers. 

the  balance  of 

43. All  this  raises  fundamental  questions  con 
cerning 
regulatory  powers 
between  public  authorities  (legislation)  and  the 
(collective  bargaining)  and 
social  partners 
between  the  social  partners  and  individual  em 
ployees  (individual  employment  contracts).  In 
particular  the  possibility  of  derogating  from  leg 
islation  by  collective  agreements  and  the  scope 
for  individual  contracts  versus  collective  agree 
ments  are  central  issues  on  today's  European  in 
dustrial  relations  agenda. 

44.  In this  context,  the  likely  development  of  la 
bour  law  and  industrial  relations  from  rigid  and 
compulsory  systems  of  statutory  regulations  to 
more  open  and  flexible  legal  frameworks  may 
pave  the  way  for  a  new  balance  of  reguiatory 
powers  between  the  State  and  the  social  part 
ners,  in  particular  in  the  areas  connected  w i th 
the  internal  management  of  firms.  Within  this 
framework  the  relationship  between  employers 
and  employees  becomes  a  key  factor  as  firms 
move  from  traditional  methods  of  organisation 
to  more  flexible  internal  arrangements.  The  role 
of  workers  in  decision  making  and  the  need  to 
the  existing  arrange 
review  and  strengthen 
ments  for  workers  involvement  in  their  compa 
nies  will  aiso  become  essential  issues.  The  Com 
mission will  launch, in the  coming  weeks, consul 
tations  with  the  social  partners  on  the  advisabil 
ity  and  direction  of  Community  action  in  the 
field  of  information  and  consultation  of  employ 
ees at  national  level. 

45. The  participation  of  employees  in  profits  and 
enterprise  results  could  also  assume  greater  im 
portance.  In  this  connection  the  Commission  re 
cently  prepared  a  report6  on  the  ways  Member 
States  have  promoted  the  participation  by  em 
ployees  in  profits  and  enterprise  results.  This 
shows  that  in  all  cases  profit-sharing  is  associat 
levels  no  matter 
ed  with  higher  productivity 

5 

6 

"Teaching  and  Learning:  Towards  the  Learning  Society"  (December  1995) 

PEPPER  II: promotion 
participation) 

in  Member  States  (COM  (96)  697  final  of  8.1.97) 

of  participation 

by  employed  persons  in  profits  and  enterprise 

results  (including 

equity 

what methods, model specification and data are 
used. Other  positive  effects  of  the  schemes are 
on  wage  flexibility, .employment  and  employee 
involvement. The development  of  financial  par 
ticipation  schemes  is,  however,  strongly  influ 
enced by government action, in particular by the 
availability  of tax incentives. 

Questions 

What  experience  do  you  have  of  changes  in 
payment systems? 

What  innovations are taking place, in particu 
lar by means of collective  bargaining? 

lime:  a new  approach 

48. Working  time  is at  the  centre  of  the  public 
debate  on the  organisation  of  work.  In particu 
lar,  the  European  Parliament  adopted  last  year 
an  important  resolution  on  a reduction  and ad 
aptation of working time7,  based on the Rocard 
report. The  debate  is about  two  separate  ques 
tions. One is about  working  time  flexibility:  the 
adjustment  of  working  time  arrangements  to 
the  needs  of  firms  or  the  needs  of  individual 
workers.  The  other  question  is  about  working 
time and employment: can a shortening of work 
ing time create more jobs? 

49. Many innovative working time arrangements 
are being introduced in firms throughout the EU, 
both  on the  initiative  of  the  firm  concerned, or 
as the  result  of  pressure  or  incentives  from  the 
Member  State.  Such  arrangements  can  take  a 
number  of forms, including: 

Changes in the length 
of the working week 

50. An  important  development  in  recent  years 
has  been  the  decoupling  of  plant  operating 
times  and  shop  opening  hours  from  individual 
working time. This has allowed firms to  increase 
the  utilisation  of  expensive  equipment,  or  to 
meet shoppers' wishes more effectively, while re 
ducing individual working time, often at no cost. 
In  this  context,  some  research  has  shown  that 
firms may employ more workers as a result of re 
ducing working time, provided that  certain con 
ditions outlined below (box) are met. 

Questions 

How  should  the  current  legal  framework  be 
modernised  to  take  account  of  new  employ 
ment trends ? 

Which  types  of  workers'  involvement  mecha 
nisms could contribute to  successful strategies 
on technical and organisational  change? 

How would the development of  direct worker 
participation  affect  the  role  of  bodies  or  or 
ganisations  representing workers? 

Wage  systems 

46. Pay is, of  course, at the heart of the  contract 
between  employers  and  workers.  But  some  of 
the pay systems in use today were developed for 
ty  or  fifty  years  ago.  Frequently  they  provided 
only for  payment for a specific job  in a hierarchi 
cal  organisation  with  a rigid  division  of  labour. 
Such wage systems are now  proving  an obstacle 
to  the  introduction  of  more  flexible  company 
structures.  It  is precisely  in the  most  up-to-date 
companies  that  traditional  pay  differentials 
between  manual  and  white  collar  workers, 
between women and men, or between members 
of the same team are no longer workable. Wage 
systems are the financial expression of  organisa 
tional and status structures within  a company. 

47. New wage systems, compatible with the flex 
ible firm, have been introduced into  many firms, 
in both manufacturing and services and in large, 
medium-sized and small firms. The characteristics 
typical of these new payment systems are broad 
er job descriptions and a corresponding decrease 
in  the  number  of  pay  grades,  incentives  to  ac 
quire  extra  qualifications,  higher  valuation  of 
new job  requirements  (such as co-operation, re 
sponsibility,  decision-making,  problem  solving, 
etc.), supplements to the basic wage paid accord 
ing  to  results  or  for  continuous  improvements, 
establishment of  internal job equity for blue and 
white-collar  employees, for  time  and  piece-rate 
workers,  for  part-timers  and  full-timers  and 
equal pay for  women and men. 

7  O.J.  N'  C 320 of 28.10.96 p. 97 

J. 

Conditions  which  may  need  to  be  satisfied  for  working  t i me  reductions  to  have  an  im 
pact  on  employment 

Reductions  in working  hours should take  place  in the  broader  context  of  a better  balance  between 
flexibility  and  security:  reducing  working  hours  while  maintaining  the  same  pattern  of  work  or 
ganisation  will  be  counter-productive. 

The way  work  is distributed  has to  be  planned  and  working  time  patterns  have to  be  adapted  to 
the  new  situation. 

The  redistribution  of  working  time  should  be accompanied  by an active training  policy.  Otherwise 
skill  shortages  are  likely  to  arise. The  speed  w i th  which  they  arise  depends  on  the  nature  of  the 
work  and  the  quality  of  the  available  labour  force. 

Barriers  to  recruitment  should  be  low.  In this  context  there  is a  need  to  look  in  particular  at  the 
effects  of  taxation  systems  on  working  time  and  to  make  the  necessary  adaptations  to  social  se 
curity  systems. 

Co-operation  between  the  public  authorities,  trade  unions  and  the  various  training  bodies  w i th 
interests  at  plant  level  is  important. 

Working  time  reductions  should  be  incorporated  into  long-term  bargaining  packages.  Many 
working  time  reductions  in  recent  decades,  for  example  in  Germany,  Belgium  and  the  Nether 
lands,  have  been  traded  against  long-term  wage  moderation.  Such  long-term  packages  have  the 
advantage  of  making  it  possible to  use productivity  increases to  reduce working  time  over  a  peri 
od  of  several  years, while  at  the  same time  reducing  the  wage  increases  needed  to  offset  the  re 
duction  in  working  time. 

Annualisation  of  working  time 

51.  There  has  also  been  a  trend  in  recent  years 
towards  coping  w i th  fluctuations  in  demand  by 
calculating  working  time  on  an  annual  basis 
rather  than  on  a  weekly  basis.  Agreements  to 
this  effect  usually  provide,  within  certain  limits, 
for  the  workers  to  receive  a  regular  salary,  rath 
er  than  one  which  fluctuates  week  by  week  or 
month  by  month.  It  can  also  enable  workers  to 
better  organise their  time  between  work  and  lei 
sure.  For  employers  it  allows  for  greater  flexibil 
ity  in  the  organisation  of  production  and  avoids 
expensive  overtime  premia. 

Part-time  work 

52. There  are  now  24  million  people  working 
part  time  in  the  Member  States.  This  form  of 
work  represents  both  opportunities  and  risks. 
From the  employer's  point  of  view  it provides  the 
flexibility  which  is  necessary  to  meet  changing 
consumer  demands,  especially  in  services.  From 
the  worker's  point  of  view  it  also  provides  a flex 
ibility  that  makes  it  easier  to  combine  work  w i th 
other  responsibilities,  for  example  studies  or 
housework.  The  problem  is  that  conditions  of 
employment,  for  example  social  protection,  for 
part-time  workers  are  often  limited  when  com 

pared  w i th  those  for  full  time  work.  This  crystal 
lises  the  need  for  a  new  balance  between  the 
interests of  employers  and workers, which  would 
have  positive  benefits  for  both  sides  and  could 
lead to  the  integration  of  part-time  workers  into 
the  labour  market,  in  particular  by  making  their 
work  less precarious. The social  partners  are  now 
negotiating  at  European  level on the  basis of  the 
Commission's  consultation  document  on  flexibil 
ity  in  working  time  and  security  for  workers.  A 
European  agreement  on  this  would  make  an  im 
portant  contribution  to  the  development  ot  flex 
ibility  and  security  in working  life. 

Flexible  leave arrangements through 
out working  life 

53. A  number  of  interesting  experiments  are  be 
ing  undertaken  in  Member  States  and  in  individ 
ual  firms  to  allow  workers  to  take  career  breaks 
for  family,  training  or  other  reasons.  The  recent 
framework  agreement  on  parental  leave  con 
cluded  by  UNICE, CEEP and  the  ETUC8  is a  good 
example  of  the  progress  at  Community  level. 

54. Such  working  lifetime  policies  may  reduce 
unemployment  and  improve  the  quality  of  life 
by  humanising  the  world  of  work  and, above  all, 
its compatibility  w i th  private  life. 

8  Annex to  Council Directive 96I34IEC of 3.6.97; O.J.  N" L 145/4 of 19.6.96 

10 

Questions 

• 

e 

What  contributionjdo  you consider  that  a re 
duction  and  adaptation  of  working  time  can 
make to the  improvement  of  growth, produc 
tivity  and employment? 

What  is the  scope  for  agreement  at  sectoral 
level on working time arrangements? Are oth 
er levels more  appropriate? 

Taxation 

55. The existing taxation systems are not normal 
ly designed to  cope with  the  new  flexible  work 
organisation.  On the  contrary,  taxation  systems 
may give employers  a financial  incentive to  em 
ploy  people  in  traditional  work  arrangements 
and therefore  act as a barrier to  a more flexible 
work  organisation. 

56. Taxes, including social security  contributions, 
falling on labour are often reiated to employees' 
income levels. Some taxes may distort employers' 
choices  on  organisation  of  working  time  as the 
imposition  of  the  taxes  can  give  incentives  to 
work either more than a certain level or less than 
a  certain  level.  For  example,  some  taxes  may 
hBMe a ceiling which can be an incentive for em 
ployer? tc  hire  only  one  employee  whose salary 
exceeds the  ceiling, and beyond which  no  addi 
tional  contributions  ara  payable,  compared  tc 
hiring two  part-time  employees whose individu 
al salaries would be below the ceiling and whose 
combined  contributions  would  be  greater  than 
for one employee. Such ceilings may also give in 
centives to  employers tc  use overtime  instead of 
hiring extra  people. 

57. Other  taxes  may  have a tax-free  floor  which 
gives an  incentive  to  employers  to  employ  part-
time  workers  below  a cartain  number  of  hours 
per week. Some taxes are a fixed amount per em 
ployee, irrespective  of the  level of  earnings, and 
consequently  give  an incentive for  employers  to 
use as small a number of  employees as possible. 

Q<LB®$t§oft 

What  reforms  are  necessary  to 
taxation 
systems, in  order  to  avoid the  disincentive  ef 
fects ? 

Social security 

which assumes that the  "normal" pattern of em 
ployment  is lifelong and permanent, with retire 
ment from the labour market taking place at the 
end of the employee's working  life. Benefits are 
therefore  predicated  upon  a  contributory  insu- -
ranee model and eligibility  often  depends  upon 
continuous service. 

59. If, as predicted, "traditional" work  structures 
are  to  continue  to  change  over  the  next  few 
decades,  the  implications  for  social  protection 
policies  in  the  longer  term  are  enormous.  The 
most  frequently-advanced  change  scenario  en 
visages the  replacement  of  the  20th century  lin 
ear  career  concept  by  a norm  of  a varied  work 
ing life. 

60. Such  changes  should  not  be  perceived  as a 
threat to social security  : flexible working can ba 
both  beneficial  to  European  economies  and  at 
tractive  to  individual  employees. Therefore,  the 
latter should not be penalised for  adopting such 
working patterns. 7Ns means that the  multitude 
of  different  forms  of  employment,  which  em 
ployees  may  increasingly  experience,  must  be 
supported  by  appropriate  social  protection 
systems. 

61.  However, it is vital that mechanisms be found 
for  adapting  European social protection  systems 
to  take  account  of  these  new  patterns  of  work. 
Obviously  there  are  no  easy  solutions  to  this 
complex  problem.  Therefore,  in  October  "[995 
the Commission launched a debate on the future 
of  social protection which addresses among  oth 
er things the  implications of changing work  pat 
terns  for  social  protection.  A  Communication' 
taking stock of the debate during  19S6 and pro 
posing  appropriate  follow-up  has recently  been 
published. 

Question 

What  adaptations  are  necessary  to  social se 
curity rules to stimulate more innovative forms 
of work  organisation? 

Health and safety at  work 

62. There  is  an  important  body  of  Community 
legislation  in  this  area,  which  already  makes  a 
significant contribution to the hearth and safety 
of  workers'0  . These  measures  may  need  to  be 
strengthened  and  adapted  in  order  to  take  ac 
count cf  changes in work  organisation. 

58. At  present,  most  European  social  security  63. In this context it should be noted that it is the 
systems are based upon a model of  employment  employer that has the duty of managing the pre-

9  Modernising  and Improving  Social Protection  in the European Union (COM(97)  102 of 12.3.97) 
1G See in particular  Council Directive 89/391/EEC of  12 June 1989 on the introduction  of  measures to  encourage 

improvements  in  the safety and heaith  of  workers  (O. J.  N'  L 183/1  cf  29 June 1989) - and subsequent individual  directives 

11 

venticn  of  occupational  ill-health.  The  growing 
importance  of  SME's as employers,  including sub 
contractors,  raises  important  health  and  safety 
issues.  Furthermore,  new  employers  often  lack 
knowledge  of  health  and  safety  risks,  and  fre 
quently  have  neither  the  time  or  money  to  recti 
fy this. Some initiatives  have already  been  under 
taken to  address this  information  gap11,  but  fur 
ther  measures  may  be  necessary.  In  addition  the 
incorporation  of  health  and  safety  within  early 
education  and  within  the  lifelong  learning  ap 
proach  will  be  increasingly  necessary  to  ensure 
that  workers  are  adequately  trained. 

Environmental 

issues 

64. The development  towards  a more  flexible  or 
ganisation  of  work  is likely to  have effects  on  the 
natural  environment,  for  example  by  changes  in 
transport  demand.  These  effects  can  be  positive 
or  negative,  depending,  in  particular,  on  individ 
ual working  time arrangements, the transport  in 
frastructure  and  the  location  of  the  work.  It  will 
be  necessary  to  identify  the  environmental  im 
pacts  of  new  forms  of  work  organisation  more 
accurately  in  order  to  develop  approaches  which 
are  compatible  w i th  sustainable  development 
and which  are beneficial for  the whole  of  society. 

Question 

What  impacts,  both  favourable  and  detrimen 
tal,  are  the  new  forms  of  work  organisation, 
flexibility  in  working  time  and  employment 
contracts, having  on the  health, safety and  job 
environment  of  workers  and  for  the  manage 
ment  of  these  issues? 

Mainsireaming 
equal  opportunities  policies 

Women  and  men 

65. The  new  developments  in  relation  to  work 
organisation  present  a  challenge  and  an  oppor 
tunity  w i th  regard  to  equal  opportunities  for 
men  and  women.  Employment  is  declining  in 
typical  traditional  male  jobs  w i th 
traditional 
work  organisation,  such  as heavy  manufacturing 
industries,  and  growing 
in  the  service  sector, 
where  women  have  a  stronger  position  and 
where  new  ways  of  working  are  more  devel 
oped. The question  is whether  the  new  organisa 
tion  of  work,  emphasising  social  skills,  broader 
skills  and  multi-tasks,  can  contribute  to  the  pro 
motion  of  equal  opportunities. 

68. Women  have  made  great  progress  in  the  la 

bour  market  during  the  last  10-20  years,  but 
there  is still a big gender  gap  in employment  and 
persisting  segregation  in the  labour  market.  The 
difference 
in  employment  between  men  and 
women  is 25  million, 85  million  men  and  60  mil-, 
lion  women  in  work.  Women's  working  patterns 
are  also  sometimes  different  from  those  of  men 
and  that  may  also  affect  the  development  of 
work  organisation. In order to  realise this  poten 
tial  it  is necessary  to  organise  not  only  firms  but 
the  whole  social  infrastructure  to  support  men 
and  women  on  a  more  equal  footing.  That  in 
cludes for  example training, child  care,  transpor 
tation,  gender  balance  in  decision  making,  indi 
vidualisation  of  rights  and  so on. 

67.  Mainstreaming,  which  is  the  guiding  princi 
ple  of  the  Fourth  Community  Action  Programme 
on  Equal  Opportunities  for  Women  and  Men 
(1996-2000)12  ,  aims  to  promote  the  integration 
of  equal  opportunities  for  women  and  men  in 
the  process  of  preparing, 
implementing  and 
monitoring  all  policies  and  activities  of  the  Euro 
pean  Union  and the  Member  States. 

Questions 

What  more  can  be  done  to  ensure  that  a  bet 
ter  gender  balance  is  achieved  through  the 
development  of  a new  organisation  of  work? 

How  far  will  the  growing  participation  of 
women  in  the  labour  market  have  an  impact 
on  work  organisation? 

Immigrants  and ethnic  minorities 

68.  New  developments  in  relation  to  work  or 
ganisation  also  present  risks  and  opportunities 
for  workers  from  immigrant  or  ethnic  minority 
backgrounds.  Businesses and  other  organisations 
are  operating  in  an  increasingly  multi-cultural 
environment,  w i th  customers,  suppliers  and  em 
ployees  from  diverse  national,  ethnic  and  cultu 
ral  backgrounds.  Success  in  the  market-place  in 
creasingly  depends  on  the  ability  to 
integrate 
this  potential  to  best  effect. 

Integration  of  people  with 
disabilities 

69. A  better  organisation  of  work  can  improve 
job  opportunities  of  people  with  disabilities,  in 
particular  it  can  help  to  ensure  that  workplaces 
and  work  arrangements  are  adapted  to  their 
needs.  Measures  involving  working  time  organ 
isation  have  aîso  proved  to  be  essential  to  in-
company  reintegration.  The  same  consideration 
applies  to  the  effect  of  the  introduction  of  new 

? 1  See "Self-Audit  Handbook 

for  SMEs on  Safety  and  Health  at  Work",  European  Commission,  1995 

12  Council  Decision  of  22.12.95,  O.J.  N°  L. 335  of  30.12.95 

12 

technologies. Telewerking  can  expand  dramati 
cally  the  employment  opportunities  of  a  wide 
range  of  people  w i th  disabilities,  in  that  it  can 
overcome  or  remove barriers and problems  relat 
ing  to  health  conditions,  safety,  fatigue  and 
stress, the  need  for  personal  assistance,  inaccess 
ible transportation  or  architectural  barriers. Con 
siderable  human  resources, which  are today  non 
productive  and  have  to  rely  mainly  on  social  as 
sistance,  can  be  released  in this  way  for  employ 
ers and  in  general  for  the  benefit  of  all  society. 

QuesticFè 

What  practical  steps can be taken  to  ensure  a 
better  use of  the  potential  of  all  our  people  in 
the  new  organisation  of  work? 

Labour merket policies 
important 
70.  Labour  market  policies  play  an 
role  in the  development  of  the  new  organisation 
of  work,  reconciling  flexibility  for  firms  and  se 
curity  for  workers.  First  of  all, there  are  huge  f i 
nancial  resources  spent  on  passive  policies,  that 
should  be  activated.  Secondly,  the  new  concept 
of  ' j ob  r o t a t i o n"  offers  opportunities  for  firms 
as well  as for  jobseekers.  Job  rotation  means  on 
the  one  hand  upgrading  the  existing  workforce 
in  order  to  achieve  bettei  quality,  higher  produ 
ctivity  and  new  forms  of  work  organisation,  on 
the  other  hand  a  need  to  recruit  substitutes, 
while the  workers  are being trained. This  recruit 
ment  could  provide  good  entry  jobs  for  young 
and  unemployed  people.  Such  a  shift  from  pas 
sive  to  active  measures,  based  on  the  job  rota 
tion  idea,  is  in  line  w i th  the  European  Council 
agreement  on  a selective  restructuring  of  public 
expenditure  to  stimulate  growth  and  e m p k --
ment. 

71.  Most  of  the  initiatives  for  the  modernisation 
of  work  organisation  must  be taken  at  a local  or 
national  level.  However,  these  initiatives  can  get 
support  from  the  European  Union,  through  the 
European  Social  Fund. Objective 4 of  the  Structu 
ral Funds has as its aim to  "facilitate  workers'  ad 
aptation  to  industrial  changes  and  to  changes  in 
production  systems".  Created  for  the  current 
programming  period  1994-99,  it  is  a  new  and 
challenging  Objective  in so far  as it  deals  primar 
ily with  people  in  employment  as compared  w i th 
the  traditional  target  groups  of  the  Social  Fund, 
namely  the  unemployed.  Objective  4  (together 
with  the  ADAPT  Community  Initiative)  carries  a 
budget  of  about  4 billion  ECU, which  when  mar 
ried  with  Member  State  and  private 
funding 
makes  it  a  European  fund  for  supporting  indus 

trial  change  of  about  7.5  billion  ECU  <&\?er  t h s ., 
five years of  its operation. The  actions•supported'' 
are  to  a  major  extent  concerned  w i th  training 
and  re-training,  but  w i t h in  an  overall  context  of 
organisational  change  within  and  among  com-
panies. 

72.  During  the  remaining  period  of  current  pro 
gramming  (1997-99),  the 
interventions  under 
Objective 4 and ADAPT will  be pursued w i th  spe 
cific aims which support the  process cf  improving 
work  organisation. An  improved  use by the  rele 
vant  bodies  of  the  opportunities  offered  by  Ob 
jective  4 and ADAPT will  be a key  demonstration 
of  their  willingness  to  improve  work 
omzrSit-
tien. 

73.  In  addition 
t he  Leonardo  da  Vinci  pro 
gramme  supports  experiments  and the  launch  of 
particularly  innovating  projects  in  this  ares-.  The 
Fifth  Framework  Programme  for  Research  and 
Development  ccuid  also  make  a  contribution  in 
support  of  research  on  new  methods  of  organ 
isation  of  work1 3. 

Question 

I 

How  do  you  consider  that  the  contribution  of  ! 
the  Structural  Funds,  and  in  particular  Ob;'e-  ! 
i 
!  ctive  4,  could  bsst  be  optimised  to  promote  a  j 
j 
,  better  organisation  of  work? 

Modernisation  of  the public sector 

74. The  public  s e c te  employs  a  significant  oro-
portion  of  the  E J  abour  force. For example  over 
9  million  people  are  employed  full-time  in  local 
government  alone. Within  these  public  organisa 
tions  there  are  increasing  pressures  tc  get  value 
for  money  both  in  order  to  keep  public  expendi 
ture  in  check  and  tc  improve  the  quality  and 
flexibility  of  service  which  the  public  expects. 
There  are  a  number  cf  example;  where  public 
sector  bodies  nave  devefoped  innovative  forms 
of  work  organisation,  with  the  active  participa 
tion  of  trade  unions,  but  both  employers  and 
trade  unions  are  conscious  of  the  fact  that  more 
needs to  be done. Indeed  in  November  1996,  the 
social partners  at  European  level  adopted  a Joint 
Declaration14 on the  modernisation  of  public  ser 
vices  which  recognised  inter  alia  that  the  reor 
ganisation  of  work  processes  and  administrative 
structures 
for 
adapting  to  the  changing  environment.  They 
emphasised  that  this  requires  a  long-term  com 
mitment  to  employment  and  the  development 
of  professional  skills,  and  that  management  of 
change  demands  co-operation  between  man 

instrument 

the  main 

is  often 

75'  "Towards 

the  5th  Framework  Programme:  Scientific  and  Technological  Objectives" 

(COM(97)47) 

14  Joint  Declaration  of  the  CEMR Employers'  Platform  and  the  European  Federation  of  Public  Service  Unions,  Brussels 

November  1996 

13 

agement  and.  labour  in  all  organisations.  The 
parties  stressed their  striving  for  reconciling  effi 
ciency w i th  a high  quality  of  working  life:  "In  an 
open  and  secure  climate  the  move  towards  a 
learning  organisation  may  be a natural  outcome 
of  the  adaptation  to  the  continuous  change". 

Telework 

75. Telework  comes  in  a variety  of  forms  - home-
based  telework,  alternating  telework,  multi-site 
telework,  freelance  telework,  mobile  teiework 
ing  and telework  from  relocated  back  offices.  Its 
centra! features  involve the  use of  telecommuni 
cations  and  advanced  information  technologies 
and the  performance  of  work  at  a location  other 
than  the  traditional  workplace. 

telecommunications,  changes 

76. Although  the  spread and penetration  of  tele 
work  remains  unclear,  the  current  numbers  of 
teleworkers  do  not  seem  to  meet  the  expansive 
forecasts  made in the  1970s. However, the  lower 
ing  cost  of 
in 
managers'  and  trade  unions'  attitudes  towards 
telework,  as  well  as  new  practices  in  respect  of 
alternating  telework,  are  strong  indications  that 
the  number  of  teleworkers  will  increase substan 
tially  in  the  coming  years. Telework  is  particular 
ly  evident  in  industries  and  occupations  which 
are  information  intensive. 

77. Any  consideration  of  telework  at  regional, 
national  or  European  level should  be strongly  in 
fluenced  by the  need for  job  creation,  increasing 

employment  opportunities,  environmental 
im 
provement  and  regional  development.  The  cen 
tral  question  here  is  how  can  we  use  telework 
and  related  techniques  to  bring  about  a  net  in 
crease  in  work  opportunities  for  Europeans  in. 
such  a  way  that  the  overall  quality  of  working 
life  is enhanced. 

78. The  transnational  dimension  of  ICTs,  and  in 
particular  the  fact  that  electronic  commerce  on 
the  internet  goes  beyond  geographical  borders, 
brings to  the  fore the  issue of  transnational  tele-
working,  international  private  law  and  transna 
tional  industrial  relations. 

labour 

79.  In  1996 the  Commission  undertook  compara 
tive  research  and  an  analysis  of 
law, 
health  and  safety  and  social  security  legislation 
and  collective  bargaining  practices  in  Member 
States  in respect  of  telework.  As a result  of  this a 
number  of  issues  were  identified  for  considera 
tion  by the  public  authorities  and the  social  part 
ners  (see  box). 

80.  It  is  necessary  to  assess  what  measures  are 
necessary  to  facilitate  the  development  of  tele 
work,  whether  the  existing  rules are  appropriate 
and what  are the  respective  roles of  the  different 
actors. These issues will  be further  assessed in  the 
context  of  the  follow-up  to  the  Green  Paper  on 
"Living  and  Working  in  the  Information  Society: 
People  First"  and  in  relation to  the  development 
of 
telecommunications  net 
works. 

trans-European 

[5SUES CONCERNING TELEWORK PRACTICES 

Contractual  status  (empioyed-seif-ernployed  teieworking) 
Voluntarism  and  teleworkers'  right  to  return  to  the  company's  premises 
Written  information  on  working  conditions 
Equality  of  treatment  between  on-site  workers  and  teleworkers 
Teleworkers'  involvement  in  information,  consultation,  participation  and  negotiation 
Teleworkers"  training  rights  and  skill  development 
Social  security  issues 
Data  protection  issues 
Environmental  impact 
Inviolability  of  home  and  the  employers'  access to  it 
Working  time,  availability  and  work  load 
Pay systems 
Infrastructure,  equipment  and  expenses 
Teleworkers'  involvement  in the  company's  affairs 
Separation  of  working  and  living  environments 
Health  and  safety  issues, including  isolation,  stress, checking  and  control 
Social  mpiications  of  trans-border  teieworking 
Legal  framework  applicable  to  freelance  teieworking,  including  trade  union  rights 

14 

Building a partnership for a new 
organisation dï work 

The challenge to the social partners 

81. The  role  of  the  social  partners,  in  firms,  at 
sectoral,  national  and  at  European level, is cru 
cial in the development of a new organisation of 
work. But both sides face challenges. 

82. For management, the challenge  is to  achieve 
a fundamental  renewal of  their  organisation  in 
such a way that they create a climate of trust and 
partnership, based on the  concepts  of  flexibility 
and security. For trade unions, the challenge is to 
ensure that  they  exercise  a constructive  and ac 
tive  roie  in  the  innovation  and  modernisation 
process within the firm and so achieve a sustain 
able balance between their  social and economic 
objectives. 

83. In a number of Member States, the social part 
ners have shown their  readiness to  adapt  to  pro 
found changes taking place in organisational struc 
tures,  management  style  and  industrial  relations 
practices in both the private and public sectors. 

84. This  experience  leads  the  Commission  to  in 
vite the social  partners and  public  authorities  to 
take  part  in  a discussion  about  partnership. The 
concept of  partnership includes, first of all, work 
ers and managers in the firm. The renewal of the 
organisation of work can only be achieved by the 
firms  themselves,  involving  management  and 
workers  and  their  representatives.  In  addition, 
the social partners and the public authorities can 
facilitate  this  work  by  improving  awareness  of 
the potential of  a new organisation of  work. 

85. This could lead towards a partnership for  the 
development of a new framework for the moder 
nisation  of the  organisation  of  work, taking  ac 
count of the interests of both business and work 
ers. The  word  "framework"  should  be  given  a 
broad interpretation. It could include everything 
from the creation of a common understanding of 
the  importance  of  new forms  of  work  organisa 
tion, through joint  declarations, to  binding con 
tractual or legal initiatives. The level and content 
of  such a framework  has to  be clarified through 
discussions, in particular  in the social dialogue. 

86. Such a partnership  could  make  a  significant 
contribution to achieving the objective of  a pro 
ductive,  learning  and  participative  organisation 
of work.  St would  be based on  European values, 
which  combine  competition  between  firms  and 
solidarity  between citizens. 

The challenge to polky makers 

87. The  European  institutions  -  the  Commission, 
the  Parliament, the Council of  Ministers, the Eco 
nomic  and  Social Committee  and the  Committee 
of  Regions - can stimulate the debate, give politi 
cal support and organise an exchange of  informa 
tion  and  knowledge  about  the  introduction  of 
new forms of work  organisation, both on the ba 
sis of  the  results achieved and the  problems  that 
have arisen. However,  policy  makers  in  European 
institutions, as well as in national and regional Par 
liaments  and  governments,  need  to  understand 
what  is happening  in firms so that they  can sup 
port the public debate in a well informed way and 
take these developments  into  account  when  for 
mulating  policy  and  modernising  legislation. 
Therefore,  this  Green  Paper  is also  addressed  to 
policy makers, to increase awareness of the poten 
tial and of the need for renewal of public policies. 

Questions on Section  II 

What actions are appropriate at the different levels: the firm, local, regional, sectoral, national and 
European? 
Under which conditions, which will vary from country to country, could decentralised negotiations 
at firm  level be developed to cover several aspects of work  organisation? 
How  could  agreement  be reached  at sectoral or  occupational  level on framework  guidelines  for 
the organisation of work, which could be applied, at the same workplace, to workers with  differ 
ent types of contractual  arrangements? 
Which  are the  most  appropriate  ways  in which this  process can be supported at  EU level, for  ex 
ample  support  from  the  Structural  Funds; support  for  training  policies and innovations  in them; 
dissemination of  information, in particular  in relation to  good practice; medium-term social policy 
analysis and research, adaptation of the  legal framework; other action ? 
How can we best mobilise our resources to realise the potential gains for  both firms and workers, 
which could arise from a new organisation of  work? 
How can we give particular  support to SMEs? 
What should be the  respective roles of the main actors who  might  be involved  in such a partner 
ship, i.e. the social partners, the public authorities, NGOs in supporting the development of a pro 
ductive, learning and participative  organisation of  work? 

15 

3:  THE CONSULTATION PROCESS 

88. As  stated  in  the  introduction,  the  main  aim  of 
this  Green  Paper  is  to  raise  awareness  and  stimu 
late  debate  on  new  ways  of  organising  work.  The 
Commission  does  not  wish  to  pre-judge  the  out 
come  of  that  debate  by  making  concrete  proposals 
for  action, at  this  stage. 

89. The  Green  Paper  is  being  given  a wide  circula 
tion  and  it  is hoped that  it will  be discussed at  local 
and  national  level,  as well  as at  European  level,  in 
particular  w i t h in  the  Social  Dialogue. 

90. The  Green  Paper  includes  questions  directed  to 
the  social  partners,  to  the  Member  States'  author 
ities  and  to  the  European  Union  institutions.  The 
Commission welcomes  comments  also from  individ 
uals  and  f r om  institutions,  f r om  practitioners  and 

from  researchers,  from  NGOs  active  in  the  social 
and  health  fields,  f r om  people  w ho  have  experi 
ence  of  new  forms  of  work  organisation  as well  as 
from  people  w ho  are  preparing  to  step  from  old 
forms  of  work  organisation  to  new  ones. 

91.  Written  comments  should be sent by 30 Novem 
ber  1997,  to 

European  Commission 
Directorate-General  V 
Rue de  la  Loi/Wetstraat  200 
B -  1049  Bruxelles/Brussel 

92.  Comments  can  also  be  sent  by  e-mail  t o: 
DG5-PartnershipQBXL.DG5.  CEC.BE 

This  document  is accessible  at  the  following  address: internet  http://europa.eu.int/ 
The  DGV  homepage  is accessible through  the  following  path: 
Welcome,  Policies,  Employment  and  Social  Policies,  on  which  page  there  is a link  to  DGV 

16 

ISSN «254-1475 

COM(97) 128  final 

EN 

m  os 

Catalogue  number  :  CB-CO-97-154-EN-C 

ISBN  92-78-18671-6 

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